Higher tax revenues predicted for most U.S. states

WASHINGTON (AP) - U.S. states expect to collect higher tax revenues in the coming budget year that combined would top pre-recession levels, according to a survey. The increase could reduce pressure on states to cut budgets and lay off workers.

Tax revenue is forecast to rise 4.1 percent to $690.3 billion in the 2013 budget year, according to a twice-yearly survey by the National Governors Association and the National Association of State Budget Officers. That would be the highest level in five years.

A slowly healing job market and modest growth have boosted sales and income taxes, which provide nearly three-quarters of state revenue. Corporate income taxes are also growing.

Still, many states continue to struggle. And some states, such as California, are seeing greater revenues only after raising taxes to stem deficits.

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